MasterCraft Boat (MCFT) 10-Q 10 Feb 17 2017 Q2 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	6 Months Ended
	Jan. 01, 2017	Feb. 07, 2017
Document and Entity Information
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Jan. 1, 2017
Document Fiscal Year Focus	2,017
Document Fiscal Period Focus	Q2
Entity Registrant Name	MCBC Holdings, Inc.
Entity Central Index Key	1,638,290
Current Fiscal Year End Date	--06-30
Entity Current Reporting Status	Yes
Entity Filer Category	Non-accelerated Filer
Entity Common Stock, Shares Outstanding		18,638,509

UNAUDITED CONDENSED CONSOLIDATE

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jan. 01, 2017	Dec. 27, 2015	Jan. 01, 2017	Dec. 27, 2015
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
NET SALES	$ 51,134	$ 55,203	$ 111,823	$ 111,184
COST OF SALES	36,848	39,838	79,728	79,980
GROSS PROFIT	14,286	15,365	32,095	31,204
OPERATING EXPENSES:
Selling and marketing	2,444	2,882	4,498	5,359
General and administrative	4,776	9,647	8,869	18,934
Amortization of intangible assets	27	56	54	111
Total operating expenses	7,247	12,585	13,421	24,404
OPERATING INCOME	7,039	2,780	18,674	6,800
OTHER EXPENSE:
Interest expense	512	44	1,123	1,008
Change in common stock warrant fair value		55		3,401
INCOME BEFORE INCOME TAX EXPENSE	6,527	2,681	17,551	2,391
INCOME TAX EXPENSE	2,496	811	6,537	1,844
NET INCOME	$ 4,031	$ 1,870	$ 11,014	$ 547
EARNINGS PER COMMON SHARE:
Basic (in dollars per share)	$ 0.22	$ 0.10	$ 0.59	$ 0.03
Diluted (in dollars per share)	$ 0.22	$ 0.10	$ 0.59	$ 0.03
WEIGHTED AVERAGE SHARES USED FOR COMPUTATION OF:
Basic earnings per share (in shares)	18,592,936	17,998,796	18,592,372	17,131,295
Diluted earnings per share (in shares)	18,605,078	18,606,884	18,598,841	17,824,985

UNAUDITED CONDENSED CONSOLIDAT3

UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Jan. 01, 2017	Jun. 30, 2016
CURRENT ASSETS:
Cash and cash equivalents	$ 6,366	$ 73
Accounts receivable — net of allowances of $95 and $65, respectively	2,464	2,966
Income tax receivable	581	5
Inventories	11,365	13,268
Prepaid expenses and other current assets	2,022	1,780
Total current assets	22,798	18,092
Property, plant and equipment - net	13,318	13,826
Intangible assets - net	16,696	16,750
Goodwill	29,593	29,593
Deferred debt issuance costs - net	542	601
Deferred income taxes	1,399	3,501
Other	170	170
Total assets	84,516	82,533
CURRENT LIABILITIES
Accounts payable	11,685	13,112
Income tax payable	359	1,108
Accrued expenses and other current liabilities	20,433	22,276
Current portion of long term debt, net of unamortized debt issuance costs	4,772	7,885
Total current liabilities	37,249	44,381
Long-term debt, net of unamortized debt issuance costs	41,954	44,342
Unrecognized tax positions	2,496	2,189
Total liabilities	81,699	90,912
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' EQUITY (DEFICIT):
Common stock, $.01 par value per share — authorized, 100,000,000 shares; issued and outstanding, 18,636,541 shares at January 1, 2017 and 18,591,808 shares at June 30, 2016	186	186
Additional paid-in capital	112,557	112,375
Accumulated deficit	(109,926)	(120,940)
Total stockholders' equity (deficit)	2,817	(8,379)
Total liabilities and stockholders' equity (deficit)	$ 84,516	$ 82,533

UNAUDITED CONDENSED CONSOLIDAT4

UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands	Jan. 01, 2017	Jun. 30, 2016
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
Allowance for doubtful accounts	$ 95	$ 65
Common stock, par value	$ 0.01	$ 0.01
Common stock, authorized shares	100,000,000	100,000,000
Common stock, issued shares	18,636,541	18,591,808
Common stock, outstanding shares	18,636,541	18,591,808

UNAUDITED CONDENSED CONSOLIDAT5

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (DEFICIT) - 6 months ended Jan. 01, 2017 - USD ($) $ in Thousands	Common Stock	Additional Paid-in Capital	Accumulated Deficit	Total
Balance, beginning at Jun. 30, 2016	$ 186	$ 112,375	$ (120,940)	$ (8,379)
Balance, beginning (in shares) at Jun. 30, 2016	18,591,808
Increase (decrease) in stockholders' equity
Equity-based compensation activity		617		617
Equity-based compensation activity (shares)	44,733
Offering costs		(435)		(435)
Net income			11,014	11,014
Balance, ending at Jan. 01, 2017	$ 186	$ 112,557	$ (109,926)	$ 2,817
Balance, ending (in shares) at Jan. 01, 2017	18,636,541

UNAUDITED CONDENSED CONSOLIDAT6

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	6 Months Ended
	Jan. 01, 2017	Dec. 27, 2015
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	$ 11,014	$ 547
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	1,622	1,667
Inventory obsolescence reserve	221	151
Deferred issuance costs	185	15
Stock-based compensation	305	12,229
Loss on extinguishment of debt		716
Change in common stock warrant fair value		3,401
Unrecognized tax benefits	307	1,000
Deferred income taxes	2,102	(2,093)
Net provision for doubtful accounts	30	(17)
Changes in operating assets and liabilities:
Accounts receivable	472	917
Inventories	1,682	104
Prepaid expenses and other current assets	(242)	(351)
Income tax receivable	(576)
Accounts payable	(1,609)	(5,300)
Income tax payable	(749)	(698)
Accrued expenses and other current liabilities	(1,843)	(733)
Net cash provided by operating activities	12,921	11,555
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property and equipment	(1,060)	(1,511)
Net cash used in investing activities	(1,060)	(1,511)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from issuance of common stock		91,071
Payment of costs directly associated with offerings	(254)	(7,202)
Excess tax benefits	312
Principal payments on long-term debt	(2,500)	(71,250)
Payments on revolving line of credit	(3,126)	(8,189)
Net cash provided by (used in) financing activities	(5,568)	4,430
NET CHANGE IN CASH AND CASH EQUIVALENTS	6,293	14,474
CASH AND CASH EQUIVALENTS — BEGINNING OF PERIOD	73	1,167
CASH AND CASH EQUIVALENTS — END OF PERIOD	6,366	15,641
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
Cash payments for interest	915	321
Cash payments for income taxes	$ 5,148	3,634
Common stock warrant
SIGNIFICANT NON-CASH INVESTING AND FINANCING ACTIVITIES:
Issuance of shares of common stock warrants		$ 12,290

ORGANIZATION AND NATURE OF BUSI

ORGANIZATION AND NATURE OF BUSINESS	6 Months Ended
	Jan. 01, 2017
ORGANIZATION AND NATURE OF BUSINESS
ORGANIZATION AND NATURE OF BUSINESS	1. MCBC Holdings, Inc. (the “Company”) was formed on January 28, 2000, as a Delaware holding company that operates primarily through its wholly owned subsidiaries, MasterCraft Boat Company, LLC; MasterCraft Services, Inc.; MasterCraft Parts, Ltd.; and MasterCraft International Sales Administration, Inc. and its subsidiaries collectively are referred to herein as the “Company”. The Company is a designer and manufacturer of premium inboard tournament ski boats and luxury performance V-drive runabouts under the MasterCraft brand. The Company also leases a parts warehouse in the United Kingdom to expedite service, primarily to dealers and customers in the European Union.

BASIS OF PRESENTATION AND SIGNI

BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES	6 Months Ended
	Jan. 01, 2017
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES	2. The Company's fiscal year begins July 1 and ends June 30, with the interim quarterly reporting periods consisting of 13 weeks. Therefore, the quarter end will not always coincide with the date of the end of the calendar month. The information furnished in the condensed consolidated financial statements includes normal recurring adjustments and reflects all adjustments, which are, in the opinion of management, necessary for a fair presentation of the results of operations and statements of financial position for the interim periods presented. Certain information and footnote disclosures normally included in annual consolidated financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and the applicable rules and regulations of the U.S. Securities and Exchange Commission (“SEC”) for financial information have been condensed or omitted pursuant to such rules and regulations. The June 30, 2016 condensed consolidated balance sheet data was derived from the audited financial statements but does not include all disclosures required by U.S. GAAP for complete financial statements. However, management believes that the disclosures in these condensed consolidated financial statements are adequate to make the information presented not misleading. These condensed consolidated financial statements should be read in conjunction with the Company's consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the fiscal year ended June 30, 2016. The unaudited condensed consolidated financial statements have been prepared on the same basis as the Company's audited consolidated financial statements for the year ended June 30, 2016 and, in the opinion of management, reflect all adjustments considered necessary to present fairly the Company's financial position as of January 1, 2017 and results of its operations, and its cash flows for the six months ended January 1, 2017 and December 27, 2015 and statement of shareholders' equity for the six months ended January 1, 2017. All adjustments are of a normal recurring nature. Our interim operating results for the six months ended January 1, 2017 and December 27, 2015 are not necessarily indicative of the results to be expected in future operating quarters. There have been no changes in the Company's significant accounting policies or critical accounting estimates for the six months ended January 1, 2017 as compared with the significant accounting policies described in the Company's audited consolidated financial statements for the financial year ended June 30, 2016. Secondary Offerings — In December 2016, the Company completed two secondary offerings for a total of 2,995,000 shares of its common stock held by certain entities associated with Wayzata Investment Partners (collectively, the “Selling Stockholders”). The public offering price for the first offering consisting of 1,495,000 shares was $13.35 per share which included 195,000 shares sold by the Selling Stockholders pursuant to the over-allotment option granted to the underwriter, which was exercised concurrently with the closing of the secondary offering. The public offering price for the second offering consisting of 1,500,000 shares was $13.45 per share. The Company received no proceeds from the secondary offerings. The Company incurred $181 for offering expenses during December 2016, which are reflected as a reduction to paid-in capital. Follow-on Offering — In September 2016, the Company completed a follow-on offering of 4,600,000 shares of its common stock held by the Selling Stockholders at a public offering price of $10.25 per share. This included 600,000 shares sold by the Selling Stockholders pursuant to the over-allotment option granted to the underwriters, which was exercised concurrently with the closing of the follow-on offering. The Company received no proceeds from the follow-on offering. The Company paid $254 for offering expenses incurred during September 2016, which are reflected as a reduction to paid-in capital. Recently Issued Accounting Standards — In July 2015, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update (“ASU”) No. 2015-11, Simplifying the Measurement of Inventory . This ASU changes the measurement principle for inventories valued under the First-In, First-Out (“FIFO”) or weighted-average methods from the lower of cost or market to the lower of cost and net realizable value. Net realizable value is defined by the FASB as estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal and transportation. This ASU is effective for annual reporting periods beginning after December 15, 2016, and interim periods within those annual periods with early adoption permitted. The Company is currently evaluating the impact this new guidance is expected to have on its financial position or results of operations and related disclosures. In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) . This guidance establishes a right-of-use (“ROU”) model that requires a lessee to record a ROU asset and a lease liability on the balance sheet for all leases with terms longer than 12 months. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statement. The new standard is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. A modified retrospective transition approach is required for lessees for capital and operating leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements, with certain practical expedients available. The Company is currently evaluating the impact this new guidance is expected to have on its financial position or results of operations and related disclosures. In March 2016, the FASB issued ASU 2016-09, Compensation – Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting . This guidance identifies areas for simplification involving several aspects of accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, an option to recognize gross stock compensation expense with actual forfeitures recognized as they occur, as well as certain classifications on the statement of cash flows. This ASU is effective for annual reporting periods beginning after December 15, 2016, and interim periods within those annual periods with early adoption permitted. The Company is currently evaluating the impact this new guidance is expected to have on its financial position or results of operations and related disclosures. In August 2016, the FASB issued ASU 2016-15, Classification of Certain Cash Receipts and Cash Payments . ASU 2016-15 addresses how certain cash receipts and cash payments are presented and classified in the statement of cash flows under Topic 230, Statement of Cash Flow , and other Topics. ASU 2016-15 is effective for annual reporting periods, and interim periods therein, beginning after December 15, 2017. The Company does not expect the adoption of this guidance to have a material impact on its consolidated financial statements. In May 2014, the FASB and International Accounting Standards Board jointly issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606) , which includes new principles-based accounting guidance for revenue recognition that will supersede virtually all existing revenue guidance. The core principle of this guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods and services. To achieve the core principle, the guidance establishes the following five steps: 1) identify the contract(s) with a customer, 2) identify the performance obligation in the contract, 3) determine the transaction price, 4) allocate the transaction price to the performance obligations in the contract, and 5) recognize revenue when (or as) the entity satisfies a performance obligation. The guidance also details the accounting treatment for costs to obtain or fulfill a contract. Lastly, disclosure requirements have been enhanced to provide sufficient information to enable users of financial statements to understand the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. In July 2015, the FASB announced that the implementation date would be delayed by one year. During 2016, the FASB issued certain amendments to clarify and improve the implementation of the guidance in ASU 2014-09. The effective date and transition requirements for these amendments and ASU 2014-09 are now for annual and interim periods beginning after December 15, 2017. Early adoption is now permitted for fiscal years beginning after December 15, 2016. The Company is currently evaluating the impact this new guidance is expected to have on our financial position or results of operations and related disclosures.

INVENTORIES

INVENTORIES	6 Months Ended
	Jan. 01, 2017
INVENTORIES
INVENTORIES	3. Inventories consisted of the following: January 1, 2017 June 30, 2016 Raw materials and supplies $ $ Work in process Finished goods Obsolescence reserve Total inventories $ $

PREPAID EXPENSES AND OTHER CURR

PREPAID EXPENSES AND OTHER CURRENT ASSETS	6 Months Ended
	Jan. 01, 2017
PREPAID EXPENSES AND OTHER CURRENT ASSETS
PREPAID EXPENSES AND OTHER CURRENT ASSETS	4. Prepaid expenses and other current assets consisted of the following: January 1, 2017 June 30, 2016 Prepaid photo shoot $ $ Insurance Trade show deposits Other Total prepaid expenses and other current assets $ $

ACCRUED EXPENSES AND OTHER CURR

ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES	6 Months Ended
	Jan. 01, 2017
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES	5. Accrued expenses and other current liabilities consisted of the following: January 1, 2017 June 30, 2016 Warranty $ $ Self-insurance Compensation and related accruals Inventory repurchase contingent obligation Interest Dealer incentives Other Total accrued expenses and other current liabilities $ $ The following table provides a roll forward of the accrued warranty liability: January 1, 2017 Beginning balance $ Provisions Payments made Adjustments to preexisting warranties Ending balance $

FAIR VALUE MEASUREMENTS

FAIR VALUE MEASUREMENTS	6 Months Ended
	Jan. 01, 2017
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS	6. Fair value is the exchange price that would be received for an asset or paid to transfer a liability (exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. There are three levels of inputs that may be used to measure fair values: Level 1 — Quoted prices (unadjusted) for identical assets or liabilities in active markets that the entity has the ability to access as of the measurement date. Level 2 — Significant other observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data. Level 3 — Significant unobservable inputs that reflect a company’s own assumptions about the assumptions that market participants would use in pricing an asset or liability. When determining the fair value measurements for assets or liabilities required or permitted to be recorded at and/or marked to fair value, the Company considers the principal or most advantageous market in which it would transact and considers assumptions that market participants would use when pricing the asset or liability. When possible, the Company looks to active and observable markets to price identical assets. When identical assets are not traded in active markets, the Company looks to market observable data for similar assets. The following tables summarize the basis used to measure certain financial assets and liabilities at fair value on a recurring basis in the consolidated balance sheets: January 1, 2017 Level 1 Level 2 Level 3 Asset — interest rate cap $ — $ $ — There were no financial assets or liabilities subject to fair value measurements at June 30, 2016. The Interest rate cap is valued utilizing pricing models taking into account inputs such as interest rates and notional amounts. Fair value measurements for the Company’s interest rate cap are classified under Level 2 because such measurements are based on significant other observable inputs. There were no transfers of assets or liabilities between Level 1 and Level 2 during the six months ended January 1, 2017.

LONG-TERM DEBT

LONG-TERM DEBT	6 Months Ended
	Jan. 01, 2017
LONG-TERM DEBT
LONG-TERM DEBT	7. Long-term debt outstanding is as follows: January 1, 2017 June 30, 2016 Revolving credit facility $ — $ Senior secured term loan Debt issuance costs on term loan Total debt Less current portion of long-term debt Less current portion of debt issuance costs on term loan Long-term debt — less current portion $ $ In May 2016, the Company entered into a Second Amended and Restated Credit and Guaranty Agreement with Fifth Third Bank, as the agent and letter of credit issuer, and the lenders party thereto (the “Amended Credit Agreement”). The Amended Credit Agreement provided the Company with an $80,000 senior secured credit facility, consisting of a $50,000 term loan (the “Term Loan”) and a $30,000 revolving credit facility (the “Revolving Credit Facility”) and matures on May 26, 2021. As of January 1, 2017, the Company had no borrowings outstanding on its Revolving Credit Facility and $3,126 in borrowings outstanding as of June 30, 2016. Availability under the Revolving Credit Facility is reduced by letters of credit. There were specified letters of credit outstanding of $250 at January 1, 2017 and June 30, 2016, respectively. As of January 1, 2017 and June 30, 2016, availability under the Revolving Credit Facility was $29,750 and $26,624, respectively, and unamortized deferred financing costs were $542 and $601, respectively. As of January 1, 2017 and June 30, 2016, the Company's total unamortized deferred financing costs were $1,315 and $1,500 respectively. These costs are being amortized over the term of the Amended Credit Agreement. As of January 1, 2017, the Company was in compliance with all of its debt covenants under its Term Loan and Revolving Credit Facility.

INCOME TAXES

INCOME TAXES	6 Months Ended
	Jan. 01, 2017
INCOME TAXES
INCOME TAXES	8. The Company’s provision for income taxes as a percentage of pretax earnings (“effective tax rate”) is based on a current estimate of the annual effective income tax rate adjusted to reflect the impact of discrete items. During the six months ended January 1, 2017 the effective tax rate was 37.2%. The rate was higher than the federal statutory rate of 35% primarily due to the inclusion of the state tax rate in the overall effective rate.

COMMITMENTS AND CONTINGENCIES

COMMITMENTS AND CONTINGENCIES	6 Months Ended
	Jan. 01, 2017
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES	9. In June 2015, Malibu Boats, LLC (“Malibu”) filed a complaint in the United States District Court for the Eastern District of Tennessee alleging that the Company’s Gen 2 Surf System and NXT Surf System infringe a Malibu patent relating to Malibu’s wake surf technology. The complaint seeks trebled damages in an unspecified amount, attorneys’ fees and an injunction against future infringement. In December 2016, the Company filed a motion with the court for summary judgment of noninfringement, which is currently pending. The trial is scheduled for May 2017. Malibu filed a separate complaint alleging that the Company’s Gen 2 and NXT Surf Systems infringe another patent in February 2016. As with the previous complaint, Malibu is seeking damages and an injunction. In December 2016, the Company filed a motion with the court for summary judgment of invalidity, which is currently pending. Trial in the second case is scheduled for October 2017. The Company does not believe that Malibu’s claims in either case have merit and intends to defend against these claims vigorously. The Company currently cannot assess the probability of losses, or reasonably estimate the range of losses, related to this matter.

EARNINGS PER SHARE

EARNINGS PER SHARE	6 Months Ended
	Jan. 01, 2017
EARNINGS PER SHARE
EARNINGS PER SHARE	10. The following table sets forth the computation of the Company’s earnings per share: Three Months Ended Six Months Ended January 1, 2017 December 27, 2015 January 1, 2017 December 27, 2015 Net income $ $ $ $ Weighted average common shares — basic Dilutive effect of assumed exercises of stock options Dilutive effect of assumed restricted share awards Dilutive effect of assumed exercises of common stock warrant — — Weighted average outstanding shares — diluted Basic earnings (loss) per share $ $ $ $ Diluted earnings (loss) per share $ $ $ $ For the three months ended January 1, 2017, the weighted average shares that were anti-dilutive, and therefore excluded from the computation of diluted earnings per share included 1,898 restricted stock awards and options to purchase 122,640 shares of common stock. For the three months ended December 27, 2015, the weighted average shares that were anti-dilutive, and therefore excluded from the computation of diluted earnings per share included options to purchase 137,786 shares of common stock. For the six months ended January 1, 2017, the weighted average shares that were anti-dilutive, and therefore excluded from the computation of diluted earnings per share included 16,534 restricted stock awards and options to purchase 122,640 shares of common stock. For the six months ended December 27, 2015, the weighted average shares that were anti-dilutive, and therefore excluded from the computation of diluted earnings per share included options to purchase 125,401 shares of common stock.

STOCK-BASED COMPENSATION

STOCK-BASED COMPENSATION	6 Months Ended
	Jan. 01, 2017
STOCK-BASED COMPENSATION
STOCK-BASED COMPENSATION	11. During fiscal year ended June 30, 2015 the Company adopted the Amended and Restated MCBC Holdings, Inc. 2015 Incentive Award Plan (“2015 Plan”) in order to facilitate the grant of cash and equity incentives to non-employee directors, employees, and consultants of the Company and certain of its affiliates and to enable the Company and certain of its affiliates to obtain and retain the services of these individuals, which is essential to our long-term success. In July 2015, the Board amended and restated the Company's 2015 Plan which became effective just prior to the closing of the Company’s initial public offering to increase the shares available for issuance under the 2015 Plan. In August 2016, the Company granted to certain employees 28,391 shares of restricted stock awards (“RSAs”) under the 2015 Plan at a per share fair value of $11.85, which is the market value of the Company’s common stock on the grant date. The RSAs will vest in three equal annual installments. In addition, the Company granted 10,770 RSAs under the 2015 Plan to certain non-employee directors for their annual equity award at a per share fair value of $11.85. In December 2016, the Company granted 5,572 RSAs under the 2015 Plan to its two new non-employee directors for their pro-rata portion of their annual equity award at a per share fair value of $13.47. During the six months ended January 1, 2017, the Company recognized $114 in stock-based compensation expense from these restricted stock awards. In August 2016, the Company granted 42,587 performance stock units (“PSUs”) under its 2015 Plan to certain employees at a per share fair value of $11.85, which is the market value of the Company’s common stock on the grant date. The awards will be earned based upon the Company’s obtainment of certain performance criteria over a three-year period. The performance period for the awards are a three-year period commencing July 1, 2016 and ending June 30, 2019. Following the determination of the Company’s achievement with respect to the performance criteria, the amount of shares awarded will be subject to adjustment based upon the application of a total shareholder return (“TSR”) modifier. The Company recognized $63 in stock-based compensation expense from these PSUs during the six months ended January 1, 2017. In July 2015, the Company granted 137,786 non-qualified stock options (“NSOs”) to certain employees at an option price equal to the $15.00 per share of the Company’s common stock, which was the initial public offering price, which will vest in 25% increments annually on each of the first four anniversaries of the grant date. In June 2016, the Company reduced the exercise price of these options by $4.30 per share, which was the amount of the special cash dividend paid in June 2016. Therefore, the exercise price of the options is now $10.70 per share. The other terms of the options remained unchanged. During the three months ended March 27, 2016, there were 15,146 stock options forfeited. We estimated the grant date fair value of stock options using the Black-Scholes pricing model assuming a risk-free interest rate of 1.93%, an expected term of 6.25 years, no dividend yield and a volatility rate of 56.7%. The Company recognized from these NSOs $128 and $127 in stock-based compensation expense during the six months ended January 1, 2017 and December 27, 2015, respectively.

BASIS OF PRESENTATION AND SIG18

BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES (Policies)	6 Months Ended
	Jan. 01, 2017
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES
Fiscal Period	The Company's fiscal year begins July 1 and ends June 30, with the interim quarterly reporting periods consisting of 13 weeks. Therefore, the quarter end will not always coincide with the date of the end of the calendar month.
Principles of Consolidation	The information furnished in the condensed consolidated financial statements includes normal recurring adjustments and reflects all adjustments, which are, in the opinion of management, necessary for a fair presentation of the results of operations and statements of financial position for the interim periods presented. Certain information and footnote disclosures normally included in annual consolidated financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and the applicable rules and regulations of the U.S. Securities and Exchange Commission (“SEC”) for financial information have been condensed or omitted pursuant to such rules and regulations. The June 30, 2016 condensed consolidated balance sheet data was derived from the audited financial statements but does not include all disclosures required by U.S. GAAP for complete financial statements. However, management believes that the disclosures in these condensed consolidated financial statements are adequate to make the information presented not misleading. These condensed consolidated financial statements should be read in conjunction with the Company's consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the fiscal year ended June 30, 2016.
Basis of Accounting	The unaudited condensed consolidated financial statements have been prepared on the same basis as the Company's audited consolidated financial statements for the year ended June 30, 2016 and, in the opinion of management, reflect all adjustments considered necessary to present fairly the Company's financial position as of January 1, 2017 and results of its operations, and its cash flows for the six months ended January 1, 2017 and December 27, 2015 and statement of shareholders' equity for the six months ended January 1, 2017. All adjustments are of a normal recurring nature. Our interim operating results for the six months ended January 1, 2017 and December 27, 2015 are not necessarily indicative of the results to be expected in future operating quarters.
Secondary and Follow-on Offerings	Secondary Offerings — In December 2016, the Company completed two secondary offerings for a total of 2,995,000 shares of its common stock held by certain entities associated with Wayzata Investment Partners (collectively, the “Selling Stockholders”). The public offering price for the first offering consisting of 1,495,000 shares was $13.35 per share which included 195,000 shares sold by the Selling Stockholders pursuant to the over-allotment option granted to the underwriter, which was exercised concurrently with the closing of the secondary offering. The public offering price for the second offering consisting of 1,500,000 shares was $13.45 per share. The Company received no proceeds from the secondary offerings. The Company incurred $181 for offering expenses during December 2016, which are reflected as a reduction to paid-in capital. Follow-on Offering — In September 2016, the Company completed a follow-on offering of 4,600,000 shares of its common stock held by the Selling Stockholders at a public offering price of $10.25 per share. This included 600,000 shares sold by the Selling Stockholders pursuant to the over-allotment option granted to the underwriters, which was exercised concurrently with the closing of the follow-on offering. The Company received no proceeds from the follow-on offering. The Company paid $254 for offering expenses incurred during September 2016, which are reflected as a reduction to paid-in capital.
New Accounting Pronouncements	Recently Issued Accounting Standards — In July 2015, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update (“ASU”) No. 2015-11, Simplifying the Measurement of Inventory . This ASU changes the measurement principle for inventories valued under the First-In, First-Out (“FIFO”) or weighted-average methods from the lower of cost or market to the lower of cost and net realizable value. Net realizable value is defined by the FASB as estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal and transportation. This ASU is effective for annual reporting periods beginning after December 15, 2016, and interim periods within those annual periods with early adoption permitted. The Company is currently evaluating the impact this new guidance is expected to have on its financial position or results of operations and related disclosures. In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) . This guidance establishes a right-of-use (“ROU”) model that requires a lessee to record a ROU asset and a lease liability on the balance sheet for all leases with terms longer than 12 months. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statement. The new standard is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. A modified retrospective transition approach is required for lessees for capital and operating leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements, with certain practical expedients available. The Company is currently evaluating the impact this new guidance is expected to have on its financial position or results of operations and related disclosures. In March 2016, the FASB issued ASU 2016-09, Compensation – Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting . This guidance identifies areas for simplification involving several aspects of accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, an option to recognize gross stock compensation expense with actual forfeitures recognized as they occur, as well as certain classifications on the statement of cash flows. This ASU is effective for annual reporting periods beginning after December 15, 2016, and interim periods within those annual periods with early adoption permitted. The Company is currently evaluating the impact this new guidance is expected to have on its financial position or results of operations and related disclosures. In August 2016, the FASB issued ASU 2016-15, Classification of Certain Cash Receipts and Cash Payments . ASU 2016-15 addresses how certain cash receipts and cash payments are presented and classified in the statement of cash flows under Topic 230, Statement of Cash Flow , and other Topics. ASU 2016-15 is effective for annual reporting periods, and interim periods therein, beginning after December 15, 2017. The Company does not expect the adoption of this guidance to have a material impact on its consolidated financial statements. In May 2014, the FASB and International Accounting Standards Board jointly issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606) , which includes new principles-based accounting guidance for revenue recognition that will supersede virtually all existing revenue guidance. The core principle of this guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods and services. To achieve the core principle, the guidance establishes the following five steps: 1) identify the contract(s) with a customer, 2) identify the performance obligation in the contract, 3) determine the transaction price, 4) allocate the transaction price to the performance obligations in the contract, and 5) recognize revenue when (or as) the entity satisfies a performance obligation. The guidance also details the accounting treatment for costs to obtain or fulfill a contract. Lastly, disclosure requirements have been enhanced to provide sufficient information to enable users of financial statements to understand the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. In July 2015, the FASB announced that the implementation date would be delayed by one year. During 2016, the FASB issued certain amendments to clarify and improve the implementation of the guidance in ASU 2014-09. The effective date and transition requirements for these amendments and ASU 2014-09 are now for annual and interim periods beginning after December 15, 2017. Early adoption is now permitted for fiscal years beginning after December 15, 2016. The Company is currently evaluating the impact this new guidance is expected to have on our financial position or results of operations and related disclosures.

INVENTORIES (Tables)

INVENTORIES (Tables)	6 Months Ended
	Jan. 01, 2017
INVENTORIES
Schedule of inventories	January 1, 2017 June 30, 2016 Raw materials and supplies $ $ Work in process Finished goods Obsolescence reserve Total inventories $ $

PREPAID EXPENSES AND OTHER CU20

PREPAID EXPENSES AND OTHER CURRENT ASSETS (Tables)	6 Months Ended
	Jan. 01, 2017
PREPAID EXPENSES AND OTHER CURRENT ASSETS
Schedule of prepaid expenses and other current assets	January 1, 2017 June 30, 2016 Prepaid photo shoot $ $ Insurance Trade show deposits Other Total prepaid expenses and other current assets $ $

ACCRUED EXPENSES AND OTHER CU21

ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES (Tables)	6 Months Ended
	Jan. 01, 2017
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES
Schedule of accrued expenses and other current liabilities	January 1, 2017 June 30, 2016 Warranty $ $ Self-insurance Compensation and related accruals Inventory repurchase contingent obligation Interest Dealer incentives Other Total accrued expenses and other current liabilities $ $
Schedule of roll forward of the accrued warranty liability	January 1, 2017 Beginning balance $ Provisions Payments made Adjustments to preexisting warranties Ending balance $

FAIR VALUE MEASUREMENTS (Tables

FAIR VALUE MEASUREMENTS (Tables)	6 Months Ended
	Jan. 01, 2017
FAIR VALUE MEASUREMENTS
Assets measured at fair value on a recurring basis	January 1, 2017 Level 1 Level 2 Level 3 Asset — interest rate cap $ — $ $ —

LONG-TERM DEBT (Tables)

LONG-TERM DEBT (Tables)	6 Months Ended
	Jan. 01, 2017
LONG-TERM DEBT
Schedule of long-term debt outstanding	January 1, 2017 June 30, 2016 Revolving credit facility $ — $ Senior secured term loan Debt issuance costs on term loan Total debt Less current portion of long-term debt Less current portion of debt issuance costs on term loan Long-term debt — less current portion $ $

EARNINGS PER SHARE (Tables)

EARNINGS PER SHARE (Tables)	6 Months Ended
	Jan. 01, 2017
EARNINGS PER SHARE
Factors used in the earnings per share computation	Three Months Ended Six Months Ended January 1, 2017 December 27, 2015 January 1, 2017 December 27, 2015 Net income $ $ $ $ Weighted average common shares — basic Dilutive effect of assumed exercises of stock options Dilutive effect of assumed restricted share awards Dilutive effect of assumed exercises of common stock warrant — — Weighted average outstanding shares — diluted Basic earnings (loss) per share $ $ $ $ Diluted earnings (loss) per share $ $ $ $

BASIS OF PRESENTATION AND SIG25

BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES - Interim Quarterly Reporting Periods (Details)	6 Months Ended
	Jan. 01, 2017
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES
Interim quarterly reporting periods	91 days

BASIS OF PRESENTATION AND SIG26

BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES - Secondary and Follow-on Offerings (Details) - Common shares $ / shares in Units, $ in Thousands	1 Months Ended
	Jan. 01, 2017USD ($)item$ / sharesshares	Oct. 02, 2016USD ($)$ / sharesshares
Secondary Public Offerings
Public Offerings
Proceeds from issuance of common stock, net | $	$ 0
Offering costs, aggregate | $	$ 181
Follow-on Public Offering
Public Offerings
Proceeds from issuance of common stock, net | $		$ 0
Offering costs, aggregate | $		$ 254
Selling Stockholders | Secondary Public Offerings
Public Offerings
Number of secondary offerings | item	2
Shares sold by selling stockholders	2,995,000
Selling Stockholders | First Secondary Public Offering
Public Offerings
Shares sold by selling stockholders	1,495,000
Public offering price per share | $ / shares	$ 13.35
Selling Stockholders | Second Secondary Public Offering
Public Offerings
Shares sold by selling stockholders	1,500,000
Public offering price per share | $ / shares	$ 13.45
Selling Stockholders | Follow-on Public Offering
Public Offerings
Shares sold by selling stockholders		4,600,000
Public offering price per share | $ / shares		$ 10.25
Selling Stockholders | Over-Allotment Option
Public Offerings
Shares sold by selling stockholders	195,000	600,000

INVENTORIES - Components (Detai

INVENTORIES - Components (Details) - USD ($) $ in Thousands	Jan. 01, 2017	Jun. 30, 2016
INVENTORIES
Raw materials and supplies	$ 6,431	$ 5,420
Work in process	1,853	2,196
Finished goods	3,634	5,984
Obsolescence reserve	(553)	(332)
Total inventories	$ 11,365	$ 13,268

PREPAID EXPENSES AND OTHER CU28

PREPAID EXPENSES AND OTHER CURRENT ASSETS - Components (Details) - USD ($) $ in Thousands	Jan. 01, 2017	Jun. 30, 2016
PREPAID EXPENSES AND OTHER CURRENT ASSETS
Prepaid photo shoot	$ 759	$ 650
Insurance	284	591
Trade show deposits	367	133
Other	612	406
Total prepaid expenses and other current assets	$ 2,022	$ 1,780

ACCRUED EXPENSES AND OTHER CU29

ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES - Components (Details) - USD ($) $ in Thousands	Jan. 01, 2017	Jun. 30, 2016
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES
Warranty	$ 11,496	$ 11,392
Self-insurance	837	809
Compensation and related accruals	1,514	1,706
Inventory repurchase contingent obligation	983	742
Interest	1,524	1,178
Dealer incentives	1,797	4,336
Other	2,282	2,113
Total accrued expenses and other current liabilities	$ 20,433	$ 22,276

ACCRUED EXPENSES AND OTHER CU30

ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES - Warranty Liability (Details) $ in Thousands	6 Months Ended
	Jan. 01, 2017USD ($)
Roll forward of the accrued warranty liability
Beginning balance	$ 11,392
Provisions	2,296
Payments made	(1,567)
Adjustments to preexisting warranties	(625)
Ending balance	$ 11,496

FAIR VALUE MEASUREMENTS - Asset

FAIR VALUE MEASUREMENTS - Assets and Liabilities at Fair Value (Details) - Recurring - USD ($) $ in Thousands	Jan. 01, 2017	Jun. 30, 2016
Assets and liabilities measured at fair value
Asset		$ 0
Liability		$ 0
Transfers of assets between Level 1 and Level 2	$ 0
Transfers of liabilities between Level 1 and Level 2	0
Level 2 | Interest rate cap
Assets and liabilities measured at fair value
Asset	$ 84

LONG-TERM DEBT - Components (De

LONG-TERM DEBT - Components (Details) - USD ($) $ in Thousands	Jan. 01, 2017	Jun. 30, 2016
Long-term debt
Long-term debt, net of unamortized debt issuance costs	$ 46,726	$ 52,227
Less current portion of long term debt	5,000	8,126
Long-term Debt - less current portion	41,954	44,342
Revolving credit facility
Long-term debt
Long-term debt		3,126
Senior secured term loan
Long-term debt
Long-term debt	47,500	50,000
Debt issuance costs on term loan	(774)	(899)
Less current portion of debt issuance costs on term loan	$ (228)	$ (241)

LONG-TERM DEBT - Senior Secured

LONG-TERM DEBT - Senior Secured Credit Facility (Details) - USD ($) $ in Thousands	Jan. 01, 2017	Jun. 30, 2016	May 22, 2016
Long-term debt
Unamortized deferred financing costs	$ 542	$ 601
Amended Credit Agreement
Long-term debt
Maximum borrowing capacity			$ 80,000
Total unamortized deferred financing costs	1,315	1,500
Senior secured term loan
Long-term debt
Loan commitment			50,000
Revolving credit facility
Long-term debt
Maximum borrowing capacity			$ 30,000
Outstanding borrowings	0	3,126
Letters of credit outstanding	250	250
Net availability under facility	29,750	26,624
Unamortized deferred financing costs	$ 542	$ 601

INCOME TAXES (Details)

INCOME TAXES (Details)	6 Months Ended
	Jan. 01, 2017
INCOME TAXES
Effective tax rate	37.20%
Statutory income tax rate	35.00%

EARNINGS PER SHARE - Factors (D

EARNINGS PER SHARE - Factors (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		6 Months Ended
	Jan. 01, 2017	Dec. 27, 2015	Jan. 01, 2017	Dec. 27, 2015
Factors used in the earnings per share computation
Net income	$ 4,031	$ 1,870	$ 11,014	$ 547
Weighted average common shares - basic	18,592,936	17,998,796	18,592,372	17,131,295
Dilutive effect of assumed exercises of common stock warrants		17,966		161,446
Weighted average outstanding shares - diluted	18,605,078	18,606,884	18,598,841	17,824,985
Basic earnings (loss) per share (in dollars per share)	$ 0.22	$ 0.10	$ 0.59	$ 0.03
Diluted earnings (loss) per share (in dollars per share)	$ 0.22	$ 0.10	$ 0.59	$ 0.03
Stock options
Factors used in the earnings per share computation
Dilutive effect of assumed exercises of stock options and restricted share awards	4,453	60,358	2,227	60,075
Restricted stock
Factors used in the earnings per share computation
Dilutive effect of assumed exercises of stock options and restricted share awards	7,689	529,764	4,242	472,169

EARNINGS PER SHARE - Anti-dilut

EARNINGS PER SHARE - Anti-dilutive Securities (Details) - shares	3 Months Ended		6 Months Ended
	Jan. 01, 2017	Dec. 27, 2015	Jan. 01, 2017	Dec. 27, 2015
Stock options
Other disclosures
Anti-dilutive securities excluded from computation of earning per share	122,640	137,786	122,640	125,401
Restricted stock
Other disclosures
Anti-dilutive securities excluded from computation of earning per share	1,898		16,534

STOCK-BASED COMPENSATION - Rest

STOCK-BASED COMPENSATION - Restricted Stock and Performance Stock Awards (Details) - 2015 Plan $ / shares in Units, $ in Thousands	1 Months Ended		6 Months Ended
	Jan. 01, 2017director$ / sharesshares	Aug. 28, 2016$ / sharesshares	Jan. 01, 2017USD ($)$ / shares
Restricted stock
Stock-Based Compensation
Stock-based compensation | $			$ 114
Restricted stock | Certain employees
Stock-Based Compensation
Granted | shares		28,391
Grant date market price | $ / shares		$ 11.85
Vesting period (in years)		3 years
Restricted stock | Certain non-employee directors
Stock-Based Compensation
Granted | shares	5,572	10,770
Grant date market price | $ / shares	$ 13.47	$ 11.85	$ 13.47
Number of new directors | director	2
Performance stock | Certain employees
Stock-Based Compensation
Granted | shares		42,587
Grant date market price | $ / shares		$ 11.85
Vesting period (in years)		3 years
Stock-based compensation | $			$ 63

STOCK-BASED COMPENSATION - Nonq

STOCK-BASED COMPENSATION - Nonqualified Options (Details) - Stock options - 2015 Plan - USD ($) $ / shares in Units, $ in Thousands	1 Months Ended		3 Months Ended	6 Months Ended
	Jun. 30, 2016	Jul. 28, 2015	Mar. 27, 2016	Jan. 01, 2017	Dec. 27, 2015
Stock-Based Compensation
Reduction in exercise price	$ 4.30
Adjusted exercise option price				$ 10.70
Certain employees
Stock-Based Compensation
Granted		137,786
Option price at grant date		$ 15
Vesting period (in years)		4 years
Options forfeited (in shares)			15,146
Stock-based compensation				$ 128	$ 127
Black-Scholes Pricing Model fair value assumptions
Risk-free interest rate (as a percent)				1.93%	1.93%
Expected term (in years)				6 years 3 months	6 years 3 months
Dividend yield (as a percent)				0.00%	0.00%
Volatility rate (as a percent)				56.70%	56.70%
Certain employees | 1st Anniversary
Stock-Based Compensation
Annual vesting percentage		25.00%
Certain employees | 2nd Anniversary
Stock-Based Compensation
Annual vesting percentage		25.00%
Certain employees | 3rd Anniversary
Stock-Based Compensation
Annual vesting percentage		25.00%
Certain employees | 4th Anniversary
Stock-Based Compensation
Annual vesting percentage		25.00%